The Office of the Superintendent of Financial Institutions says geopolitical uncertainty, economic change and rapid technological advances have intensified risk in the Canadian financial system.
The comments come as the federal banking regulator offered its regular update to its annual risk outlook that was published in the spring.
The report focuses on how frontier artificial intelligence can amplify cyber, technology, third-party and reputational risks.
It notes that as AI capabilities advance, institutions need to strengthen governance, controls and testing.
Peter Routledge, the superintendent of financial institutions, says in an era of advancing AI capabilities, resilience is a competitive advantage.
He says financial institutions that use AI responsibly while managing cyber, technology, and third-party risks will position themselves to thrive in a complex environment.
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